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Credit Card Rates Up Slightly, but 0 Percent Offers Get Longer

Interest rates on general consumer credit cards ticked up in the first three months of the year, but no-interest offers generally got longer, a new analysis from CardHub.com finds.

The average annual percentage rate on cards for a customer with excellent credit was 12.98 percent in the first quarter of the year, up from 12.46 percent a year ago — an increase of about 4 percent.

Meanwhile, terms for 0 percent offers, for both new purchases and balance transfers, grew longer. It appears, according to CardHub’s report, that card issuers are willing to sacrifice interest revenue early on, in the hope of recapturing it later through higher annual percentage rates.

Introductory terms now range from six to 18 months, depending on the the card and the type of transaction. The average introductory no-interest offer was about 10 months in the first quarter, up from about seven months a year ago.

But balance transfer fees rose slightly, as card issuers try to compensate for lost finance charges during the longer introductory no-interest periods.

There are no-transfer fee offers out there, however. Slate from Chase, for instance, is currently offering no interest for 15 months, for both purchases and balance transfers, with no balance transfer fee.

Cardhub says its report is based on a review of about 1,000 credit card offers.

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